Sandisk: AI turned a memory maker into a margin machine. Can it last?

Executive Summary

Sandisk has gone from a spun-off flash memory business to one of the most profitable hardware companies in the AI build-out in about a year. In fiscal Q4 2026 (quarter ended July 3, 2026) revenue reached $8.97B, up 372% year over year, and non-GAAP gross margin hit 84.6% — a number more typical of software than of memory chips. Management guided the next quarter to $10.3B–$10.8B of revenue.

The question for the next earnings report (expected around October 29) is no longer whether AI demand is real. It is whether NAND pricing can stay this high once the steepest part of the price increases is behind us.

Why This Matters

AI servers need far more storage than traditional servers: training data, checkpoints, and increasingly the data that inference systems retrieve on the fly. That demand landed on a NAND industry that had cut investment during the 2023 downturn. The result was one of the sharpest pricing swings the memory industry has seen.

The Thesis (in short)

Sandisk is no longer priced like a commodity memory maker, and its results no longer look like one. Our view: the business has structurally improved — datacenter is now a real pillar and multi-year customer agreements add visibility — but the stock now depends on pricing staying high for longer than memory cycles usually allow.